What is the value of the government spending multiplier if marginal propensity to consume is...
adjectivamr0g
Answered question
2023-02-21
What is the value of the government spending multiplier if marginal propensity to consume is 0.6?
A)0.1333
B)0.4
C)1.333
D)2.5
A)0.1333
B)0.4
C)1.333
D)2.5
Answer & Explanation
Haylie Long
Beginner2023-02-22Added 7 answers
The correct option is B 2.5
The multiplier is given by 1(1−c).
So, when c = 0.6, the multiplier is 2.5.
The multiplier is given by 1(1−c).
So, when c = 0.6, the multiplier is 2.5.
